Global Skincare Marketer Looks Good
Nu Skin Inc. is a global direct selling company with operations in 53 markets
worldwide. The Company develops and distributes anti-aging personal care products and
nutritional supplements through 950,000 distributors worldwide under the Nu Skin and Pharmanex brand names. [PostStockWidget stock_valuation="" pricetype="live" manual_date="Dec. 21, 2012, 2:04pm GMT" symbolcodes="'NUS'" symbolprices="33" div_align="right"]
Due to their exposure to China and the direct selling nature of their business, we are only initiating a 2.5% position rather than the usual 5% position.
At the right valuation this skin care stock should make us look good because NUS has a strong financial position. They have a PE ratio of 12.3X, a PEG ratio of 0.36X, cash on the books of $370M, etc… We think that at this valuation, our chances of reaching higher valuations are good.
Purple Chips 12 -18 month target: $95.00
LOW VALUATION IN NU SKIN INC AT $USD 73.50 (NUS-US, $73.50) HALF POSITION
PURPLE CHIPS TARGET: $95.00 POSITION SIZE: HALF (2.5%) P/E: 12.1X DIV: $1.38 (1.8%) MKT CAP: $4.4B Cash: $370M RETURN ON CAPITAL: 75.5% EARNINGS YIELD: 13.6% 5 YR EPS Growth rate*:34.9% P/E/G Ratio: 0.36X 2014 EPS: $6.09 2015 EST.: $6.94 2016 EST.: $8.36
*Blended growth rate= 2/3 historical (5yrs), 1/3 forward.
